Homework Answers
a)
Payback period for fixed cash inflow project
= Initial Investment / Annual cash inflow
= $542,000 / $75,000
= 7.23 Years
b)
Since the payback period ( 7.23 Years ) is within the acceptable limit of 8 years, the project should be accepted by the company
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> = 7.22 years
the project is accepted 7.22<8
Ayyas Wed, Dec 15, 2021 12:46 PM